Managing Change Handout

Contents

Change Models:
Balanced Scorecard

Eight Steps in Leading Change - John Kotter

Shingo Model for Operational Excellence (LEAN approach)

Diffusion of Innovations - Everett Rogers

Four Stages of Team Development - Bruce Tuckman

Individual change models:

ADKAR

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Three phases of Transition - William Bridges

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Roller Coaster of Change - Stephen Haines

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CHANGE MODELS
Balanced Scorecard
A strategic planning and performance management tool that can be used by managers to keep
track of the execution of activities by the staff within their control and to monitor the
consequences arising from these actions. The Balanced Scorecard presents a mixture of financial
and non-financial measures (typically, no more than 20 to 25 of the most critical indicators) each
compared to a 'target' value within a single concise report. It articulates the links between leading
inputs (human and physical), processes, and lagging outcomes and focuses on the importance of
managing these components to achieve the organization's strategic priorities. The Balanced
Scorecard depicts the organizations success at aligning organizational improvement efforts to
strategies to meet customer needs by focusing on the four perspectives. Those four
"perspectives" are designed to answer the following questions:

Financial: encourages the identification of measures that answer the question How do
we optimize expenditures for maximum mission effectiveness?

Customer: encourages the identification of measures that answer the question "To
achieve our vision, how should we appear to our customers?

Internal Business Processes: encourages the identification of measures that answer the
question "To satisfy our stakeholders, which processes must we excel at?"

Learning and Growth: encourages the identification of measures that answer the question
"To achieve our vision, how can we continue to improve and create value?"

Historically, organizations measured financial measures almost exclusively. In recent decades, this
approach has been criticized as lacking predictive power, reinforcing functional silos, rewarding
short-term target achievement to the detriment of long-term goals, and irrelevant to most levels
of an organization. The Balanced Scorecard grew out of the need to measure not only the
successes of the past but also the value-creating and destroying mechanisms of the organization,
that ultimately are reflected in financial results including the ability to attract funding. Thus the
balance in the Balanced Scorecard, relates to three areas:

Balance between financial and nonfinancial indicators of success Ultimately, financial

success is derived from the ability to execute on the mission and vision, therefore that
execution must be measured as it is occurring, rather than just after the fact.

Balance between internal and external stakeholders In order to meet external

stakeholders expectations, internal stakeholder issues must also be measured
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Balance between lad and lead indicators of performance Lag indicators, such as
revenue or customer satisfaction, represent past performance. These types of measures
lack predictive power, therefore it is necessary to include lead indicators which are the
performance drivers that lead to the achievement of the lag indicators. These often
include the measurement of processes and activities that ultimately lead to results.

The Balanced Scorecard is utilized as a strategic management system in several ways other than
mere review of past results:

Communication Cascading the scorecard that is, driving it down into all levels of the
organization gives employees the opportunity to demonstrate how their day-to-day
activities contribute to the organizations strategy. This creates a line of sight between
the front-line employee and top leaders.

Strategic Resource Allocation The resources necessary to achieve scorecard targets

form the basis for the development of the annual budgeting process, thereby directly
tying resources to achievement of the organizations goals.

Continuous Improvement Balanced Scorecard results form the basis for reviewing,
questioning, and refining the strategies and tactics needed to achieve the organizations
goals.

Eight Steps in Leading Change - John Kotter

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According to Kotters research, 70% of all major change efforts in organizations fail, because
organizations often do not take the holistic approach required to see the change through. By
following Kotters 8 Step Process, organizations can avoid failure and become adept at change.
By improving their ability to change, organizations can increase their chances of success, both
today and in the future. Without this ability to adapt continuously, organizations cannot thrive.

The 8 steps are as follows:

1.

Create Urgency Kotter suggests that for change to be successful, 75% of a company's
management needs to support the change, so a key early task is to develop a sense of
urgency around the need for change. This can involve a full SWOT analysis, scenario
planning and full deployment of all the strategic planning tools. Results of analysis and
early conclusions should be thoroughly tested with informed third party opinion and a
wide cross section of all stakeholders.

2.

Form a guiding coalition Managing change is not enough change must be led. Building
the momentum for change requires a strong leadership and visible support from key
people within the organization. The coalition will involve a wide representation of the
formal and informal power-base within the organization. By working as a team, the
coalition helps to create more momentum and build the sense of urgency in relation to
the need for change. Kotter recognizes the importance of the emotional dimension and
the energy that is generated by a mastermind group all working together.

3.

Develop a vision and strategy A drive for change without a clear focus will rapidly fizzle
out unless leaders develop a clear vision of the future that is accompanied with a clear
description about how things will be different in the future. The vision must be defined in
such a way that it is capable of expression in a short vision speech that conveys the
heart of the change in less than 5 minutes. This then needs to be encapsulated in a
powerful one or two sentence summary. All members of the coalition must be fluent in
both of these vision statements, and leaders must with the coalition to develop the
strategies that will deliver the vision.

4.

Communicate the vision Communication is everything, and Kotter maintains that

change leaders must use every means at their disposal to constantly communicate the
new vision and key strategies that support that vision. This goes beyond the special
announcement meetings and involves frequent and informal face-to-face contact with
people by all individual members of the coalition. Email is not the appropriate
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communication vehicle, except in support of prior face-to-face contact. The leaders must
also walk the talk visibly, and at all times be available and accessible to people, openly
and honestly and addressing the emotional dimension of the fears and concerns.
5.

Enable action and removal of obstacles In this stage, the change initiative moves
beyond the planning and the talking, and into practical action, as leaders put supportive
structures in place and empower and encourage people to take risks in pursuit of the
vision. This is where the change leader identifies and removes obstacles and obstructions
to change. This may also involve addressing resistant individuals and/or groups and
helping them to reorient themselves to the requirements of the new realities

6.

Generate short-term wins Success breeds success. Kotter advises that an early taste of
victory in the change process gives people a clear sight of what the realized vision will be
like. This is important as a counter to critics and negative influencers who may otherwise
impede the progress of the initiative. It is also important to recognize and reward all
those people who make these early gains possible. Change leaders must look for and
create opportunities for these early wins.

7.

Hold the gains and build on change Kotter argues that many change initiatives fail
because victory is declared too early. An early win is not enough. This is the time to
increase the activity, change all systems and structures and processes that dont fit with
the change initiative, and bring new blood into the coalition. This now all about
continuous improvement and each success (and failure) is an opportunity to analyze what
worked, what did not, and what can be improved.

8.

Anchor changes in the culture Kotter says that for any change to be sustained, it needs
to become embedded in the new way we do things around here that is, the culture. A
major part of this is for the change leader to articulate the connections between new
behaviors and organizational success. This is where the coalition tea talks about progress
at every opportunity. Tell success stories about the change process, and repeat other
success stories. This is successful if change leaders put forth continuous efforts to ensure
that the change is seen in every aspect of the organization.

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Shingo Model for Operational Excellence (LEAN approach)

The Shingo Model is based on the lean management approach and model taught by Dr. Shigeo
Shingo. Shingos teachings described 3 levels of business improvement (transformation):
Principles, Systems, Tools and Techniques.
True innovation is not achieved by superficial imitation or isolated or random use of Tools &
Techniques and Systems (know how) but requires the understanding of the underlying Principle
(know why). Both know-how and know-why at the lowest level of the organization are required
for cultural transformation. The Shingo model is a principles-based process for embedding the
principles of organizational excellence into the organizational culture. The ultimate goal when
pursuing the model is cultural transformation through the integration of principles of operational
excellence across the enterprise to create a complete, systemic view that leads to consistent
achievement of results. The broader goal is to serve as a roadmap for organizations to a better
future state based on universal and timeless principles.
Tools and systems have been traditionally viewed as linear and independent, which causes slow
growth curve and a drop off of sustainment. Principles are not enough to accelerate a cultural
transformation. All three (principles, systems and tools) must be aligned to create the desired
traction required to transform a culture.
Principles and Values guide this thinking, which in turns guides behaviors. Behaviors define
culture. Principles guide the what, why and how of actions. Without constant attention, the
principles will fade, so they must be ingrained.
The Shingo model is both behavior driven and performance driven. Organizations must identify
what specific measures align with their goals and objectives, and they must also identify what
specific behaviors would be expected to accomplish those goals and objectives. The goal is to
create consistent, repeatable behavior to accomplish the performance measures. The Model is a
baseline to help managers identify where their company is on the journey to operational
excellence, and to assess the breadth and depth of transformation within the organization. It is an
engine for transforming the culture of an organization.
In short, the Shingo model encompasses the following view:
1. There is a clear and strong relationship between principles, systems, and tools.
2. Operational excellence requires focus on both behaviors and results.
3. Business and management systems drive behavior and must be aligned with correct
principles.
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Diffusion of Innovations - Everett Rogers

Diffusion is based on innovations, communication channels, time, and social systems. The five
stages of adoption are: Knowledge, Persuasion, Decision, Implementation and Confirmation. The
five adopter categories are: Innovators, Early Adopters, Early Majority, Late Majority, and
Laggards

Five stages of the adoption process:

1.

Knowledge: In this stage the individual is first exposed to an innovation but lacks
information about the innovation. During this stage of the process the individual has not
been inspired to find more information about the innovation.

2.

Persuasion: In this stage the individual is interested in the innovation and actively seeks
information/detail about the innovation.

3.

Decision: In this stage the individual takes the concept of the innovation and weighs the
advantages/disadvantages of using the innovation and decides whether to adopt or reject
the innovation. Due to the individualistic nature of this stage Rogers notes that it is the
most difficult stage to acquire empirical evidence (Rogers 1964, p. 83).

4.

Implementation: In this stage the individual employs the innovation to a varying degree
depending on the situation. During this stage the individual determines the usefulness of
the innovation and may search for further information about it.

5.

Confirmation: Although the name of this stage may be misleading, in this stage the
individual finalizes his/her decision to continue using the innovation and may use the
innovation to its fullest potential.

Adopter Categories:
1.

Innovators: Innovators are the first individuals to adopt an innovation. Innovators are
willing to take risks, youngest in age, have the highest social class, have great financial
lucidity, very social and have closest contact to scientific sources and interaction with
other innovators. Risk tolerance has them adopting technologies which may ultimately
fail. Financial resources help absorb these failures. (Rogers 1962 5th ed, p. 282)

2.

Early Adopters: This is the second fastest category of individuals who adopt an
innovation. These individuals have the highest degree of opinion leadership among the
other adopter categories. Early adopters are typically younger in age, have a higher social
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status, have more financial lucidity, advanced education, and are more socially forward
than late adopters. More discrete in adoption choices than innovators. Realize judicious
choice of adoption will help them maintain central communication position (Rogers 1962
5th ed, p. 283).
3.

Early Majority: Individuals in this category adopt an innovation after a varying degree of
time. This time of adoption is significantly longer than the innovators and early adopters.
Early Majority tend to be slower in the adoption process, have above average social
status, contact with early adopters, and seldom hold positions of opinion leadership in a
system (Rogers 1962 5th ed, p. 283)

4.

Late Majority: Individuals in this category will adopt an innovation after the average
member of the society. These individuals approach an innovation with a high degree of
skepticism and after the majority of society has adopted the innovation. Late Majority are
typically skeptical about an innovation, have below average social status, very little
financial lucidity, in contact with others in late majority and early majority, very little
opinion leadership.

5.

Laggards: Individuals in this category are the last to adopt an innovation. Unlike some of
the previous categories, individuals in this category show little to no opinion leadership.
These individuals typically have an aversion to change-agents and tend to be advanced in
age. Laggards typically tend to be focused on traditions, likely to have lowest social
status, lowest financial fluidity, be oldest of all other adopters, in contact with only family
and close friends, very little to no opinion leadership.

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Four Stages of Team Development: Norming, Forming, Storming, Performing

Bruce Tuckman

Forming
In the first stages of team building, the forming of the team occurs. The individual's behavior is
driven by a desire to be accepted by the others, and avoid controversy or conflict. Serious issues
and feelings are avoided, and people focus on being busy with routines such as team organization,
who does what, when to meet, etc. Individuals are also gathering information and impressions
about each other, and about the scope of the task and how to approach it. This is a comfortable
stage, but the avoidance of conflict and threat means that not much actually gets done.
The team meets and learns about the opportunities and challenges, and then agrees on goals and
begins to tackle the tasks. Team members tend to behave quite independently. They may be
motivated but are usually relatively uninformed of the issues and objectives of the team. Team
members are usually on their best behavior but very focused on themselves. Mature team
members begin to model appropriate behavior even at this early phase. Sharing the knowledge of
the concept of "Teams - Forming, Storming, Norming, Performing" is extremely helpful to the
team. Supervisors of the team tend to need to be directive during this phase.
The forming stage of any team is important because in this stage, the members of the team get to
know one another, exchange some personal information, and make new friends. This is also a
good opportunity to see how each member of the team works as an individual and how they
respond to pressure.

Storming
Every group will next enter the storming stage in which different ideas compete for consideration.
The team addresses issues such as what problems they are really supposed to solve, how they will
function independently and together and what leadership model they will accept. Team members
open up to each other and confront each other's ideas and perspectives. In some cases, storming
can be resolved quickly. In others, the team never leaves this stage. The maturity of some team
members usually determines whether the team will ever move out of this stage. Some team
members will focus on minutiae to evade real issues.

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The storming stage is necessary to the growth of the team. It can be contentious, unpleasant and
even painful to members of the team who are averse to conflict. Tolerance of each team member
and their differences should be emphasized. Without tolerance and patience, the team will fail.
This phase can become destructive to the team and will lower motivation if allowed to get out of
control. Some teams will never develop past this stage.
Supervisors of the team during this phase may be more accessible, but tend to remain directive in
their guidance of decision-making and professional behavior. The team members will therefore
resolve their differences and members will be able to participate with one another more
comfortably. The ideal is that they will not feel that they are being judged, and will therefore
share their opinions and views.

Norming
The team manages to have one goal and come to a mutual plan for the team at this stage. Some
may have to give up their own ideas and agree with others in order to make the team function. In
this stage, all team members take the responsibility and have the ambition to work for the success
of the team's goals.

Performing
It is possible for some teams to reach the performing stage. These high-performing teams are
able to function as a unit as they find ways to get the job done smoothly and effectively without
inappropriate conflict or the need for external supervision. By this time, they are motivated and
knowledgeable. The team members are now competent, autonomous and able to handle the
decision-making process without supervision. Dissent is expected and allowed as long as it is
channeled through means acceptable to the team.
Supervisors of the team during this phase are almost always participative. The team will make
most of the necessary decisions. However, even the most high-performing teams will revert to
earlier stages in some circumstances. Many long-standing teams go through these cycles many
times as they react to changing circumstances. For example, a change in leadership may cause the
team to revert to storming as new people challenge the existing norms and dynamics of the team.

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INDIVIDUAL CHANGE MODELS

ADKAR
ADKAR is a goal-oriented change management model that allows change management teams to
focus their activities on specific business results. ADKAR is the acronym for Awareness, Desire,
Knowledge, Ability, and Reinforcement. These are the elements of the most fundamental
requirements for anyone to succeed and maintain change. The model is a results-oriented change
management tool that is simple and easy to understand, yet very effective for leaders and change
management teams. It was initially used as a tool for determining if change management
activities like communications and training were having the desired results during organizational
change. The model has its origins in aligning traditional change management activities to a given
result or goal. By identifying the required outcomes or goals of change management, ADKAR
becomes a useful framework for change management teams in the planning and execution of
their work.
The goals or outcomes defined by ADKAR are sequential and cumulative. An individual must
obtain each element in sequence in order for a change to be implemented and sustained.
Leaders can use this model to identify gaps in their change management process and to provide
effective coaching for employees. The ADKAR model can be used to:

diagnose employee resistance to change

help employees transition through the change process

create a successful action plan for personal and professional advancement during change

develop a change management plan for employees

This model can identify why changes are not working and help leaders in taking the necessary
steps to make the change successful. Leaders will be able to break down the change into parts,
understand where the change is failing and address that impact point.
The ADKAR model was first created by Prosci Research, a change management company, after
research with more than 300 companies undergoing major change projects. In 2006, Prosci
released the first complete text on the ADKAR model in Jeff Hiatt's book ADKAR: A Model for
Change in Business, Government and Our Community. This model is intended to be a coaching tool
to help employees through the change process. To use the ADKAR model effectively, leaders must
understand the underlying framework for change initiatives. Change happens on two dimensions:
the business dimension and the people dimension. Change is successful when both dimensions of
change occur simultaneously.
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Business dimension of change

The business dimension of change includes the typical project elements.

Business need or opportunity is identified.

Project is defined (scope and objectives).

Business solution is designed (new processes, systems and organizational structure).

New processes and systems are developed.

Solution is implemented into the organization.

These are the standard elements of a business change that managers feel most comfortable
managing.

People dimension of change

Research shows that problems with the people dimension of change are the most commonly cited
reasons for project failures. In a study with 248 companies, effective change management with
employees was listed as one of the top-three overall success factors for the project. Helping
managers to be effective sponsors of change was considered the most critical success factor.
Effective management of the people dimension of change requires managing five key goals that
form the basis of the ADKAR model:

Awareness of the need to change Do you (or your staff) understand why the desired
change is needed? (What will be the result of the transition?)

Desire to participate and support the change Are you (or your staff) motivated to make
the desired change?

Knowledge of how to change (and what the change looks like) Do you (or your staff)
know how make the desired change happen?

Ability to implement the change on a day-to-day basis Have you (or your staff) been
given the right information and training?

Reinforcement to keep the change in place Do you (or your staff) have a system of
encouraging or keeping the change in place?

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Three Phases of Transition - William Bridges

According to Bridges theory, change is situational; transition, on the other hand, is a
psychological, three-phase process that people go through as they internalize and come to terms
with the details of the new situation that the change brings about. Situational changes are not as
difficult for companies to make as the psychological transitions of the people impacted by the
change. The three phase process consists of the following:

1. Ending, Losing, Letting Go - helping people deal with their tangible and intangible losses
and mentally prepare to move on. Initially most of the activity in managing the emotional
and psychological journey of transition is related to the letting go of the past and later
related to investing in and transitioning to the future. Bridges identifies five aspects of the
natural ending experience: Disengagement, Dismantling, Dis-identification, Disenchantment
and Disorientation. The process of letting go of the past can bring up feelings of sadness,
grief and loss as well as some relief or anticipation about the possible new future. The
starting point for dealing with transition is not the outcome, but the ending the person must
make to leave the old situation behind. Endings can be managed by treating the past with
respect, helping compensate for losses, giving people plenty of the right information,
marking the endings, and helping define what is over and what isnt.
2. The Neutral Zone - The neutral zone is that in-between place where one loses the sense of
relatedness and purpose, because much of ones identity is tied up in the old way of life. At
this stage, there are no new anchors to give any context or meaning, and that can be
difficult, confusing and painful. Critical psychological realignments and repatterning takes
place. This stage involves helping get people through it, and capitalizing on all of the
confusion by encouraging them to be innovators.
The neutral zone is a place of both risk and opportunity. It is risky because people are unsure
of the process being created and may become anxious, during which time productivity may
fall. Old weaknesses, compensated for in the old arrangements, may rise to the surface.
People may get mixed signals between the old regimen and the new, and people may
become polarized one way or the other, leading to tension and discord. In addition, until
the new regimen becomes embedded, the new arrangements are vulnerable to internal or
external shocks.
For all these reasons, transitions through the neutral zone need to be managed carefully.
Bridges provides a number of mechanisms for this, including creating temporary support
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systems and short term goals, and redefinition of the activity in the neutral zone in terms of
more familiar activity or metaphors.
The neutral zone is also, however, a point of creative opportunity: as people and systems
unfreeze from the old systems and have not yet frozen back into the new systems, there
is tremendous opportunity to identify and realize changes and find new ways of doing
things.
3. The New Beginning - Assisting people develop the new identity, experience the new
energy, and discover the new sense of purpose that make the change begin to work.
Bridges distinguishes between starts and beginnings. A start occurs when people start
doing new things, when they start enacting the changes. A beginning occurs, however, only
when the personal psychological and behavioral change takes place and people take on new
behaviors and identities.

Transition managers must define the 4Ps defining the path into the future:

The purpose of the transition

The picture or vision

The plan

The part for each person to play

In addition, being consistent (avoiding conflicting messages), building momentum with quick
successes, symbolizing the new entity, and celebrating successes can all help with successful
transitions.

Bridges book also has some excellent tools. For example, Bridges provides the following tool to
identify what is ending and who is losing what:

Describe the change in as much detail as you can

Identify the secondary changes that the change will probably cause and the further
changes that those changes will cause

Determine how people will be affected who will have to let go of something?

Think of these from the subjective viewpoint of people affected

Beyond these losses, is there something that is over for everyone?

Another useful recommendation that Bridges proposes is the creation of a Transition Monitoring
Team a group composed of individuals from across the organization holding various roles, whose
sole purpose is to provide a feedback on the status of the transition across the organization.
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Roller Coaster of Change - Stephen Haines

The Rollercoaster of Change is a term Haines coined, that distills 20-plus change theories into a
simple way of understanding the dynamics of how to effect successful change of all types. The

model starts with the observation that life is full of cycles that are natural, normal,
historical facts of life, and that the pace of change is accelerating.
Haines believes that the concept of organizational change is a myth, and that change is
an individual, emotional, and psychological matter for each of us. The bigger the
organization, the more difficult it is to get everyone to change and focus on the customer
instead of on oneself alone. Thus, productivity, quality, and other results take a nose dive.
Things will almost always get worse before they get better. Therefore, leaders must
manage and lead themselves first, and only then, help others through the six stages of the
Rollercoaster. Everyone goes through these stages at different rates, depths, and times.

The stages are as follows:

1. Rollercoaster Stage 1: Smart Start PlantoPlan Day, with senior management,
to get educated, assess the situation, and organize and tailor the change process
before the trainer begins. The process must be extremely precise in order to
significantly reduce the Rollercoaster effect and keep up morale and productivity.
2. Rollercoaster Stage 2: Shock and Denial In the first week after announcing the
changes, senior management must be available to communicate the desired
changes and their rationaleover and over, face to face. The question is not if
employees will go through the Rollercoaster, but when, how deep, how long will
it take, and whether they will successfully reach the other side. Going through
Stages 4, 5 and 6 (Persevering, Hope and Rebuilding) are optional and depend on
effective change process leadership. The key is to help people understand why.
3. Rollercoaster Stage 3: Anger and Depression This is a time of high uncertainty,
anxiety and resistance to change. Thus leaders need to spend a great deal of time
assisting all of their employees through the change. A Catch 22 of the
Rollercoaster is the fact that once it begins, one cannot go back and erase what
has started. Instead, attempting to reverse changes already begun just kicks off
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another Rollercoaster, only this time from the spot at which the reversal attempt
was made. Since this is usually at Stage 3 , this new Rollercoaster will take
employees deeper down into depression. What helps people through Stage 3 is
the sequence of managers 1) listening, 2) asking questions, 3) empathizing, and,
only then, 4) explaining the vision and why it is significant. Letting people
experience firsthand the executive decision-makers presence and rationale for the
change is also crucial.
4. Rollercoaster Stage 4: Hang-In and Persevere Perseverance is key at this step. It
is where change often fails because people cant stand the pain and emotion and
try to quit the change, only to have it get worse (a new change curve kicked off
from a lower point). The need for hanging in and persevering during the change is
the essence of good change management
5. Rollercoaster Stage 5: Hope and Readjustment- At this stage, leaders must help
clarify each persons new role and the required new expectations of performance,
then find ways to gain maximum involvement and understanding of WIIFM
(Whats In It For Me) by everyone on how it is to their personal advantage to
achieve the firms new vision and/or values and culture. The only way through
Stage 5 is through leadership. Involving people in some aspect of the change to
control their destiny is essential for the adjustment and hope of Stage 5. The key
is involvement in the how to; the what should already have been decided in a
participative fashion, since People support what they help create.
6. Rollercoaster Stage 6: Rebuilding and Productivity Refreezing/renewing and
maintaining stability/flexibility at this stage is the key to recovering productivity.
All of the first 5 Stages are about focusing on the person and not the organization;
customers often get ignored until Stage 6, in which leaders empower the fully
committed individuals and teams toward their vision and values. This stage
highlights the difficulty in creating a critical mass in support of the desired
changes. The importance of getting people to not only buy-in, but also to stayin throughout the Rollercoaster (and its bottoming out) process is critical. At this
point, leaders will begin to make other incremental changes in response to
changing conditions. This continues indefinitely (i.e., continual improvement).
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